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November 23, 2011

At the invitation of Indian President Pratibha Devisingh Patil, Myanmar President U Thein Sein made a three-day goodwill visit to India recently. The visit was very significant from the political and economic perspectives.

His visit took place in a context which is significantly different from that of last year when his predecessor, Senior General Than Shwe visited India.

Myanmar now has a civilian government, although dominated by former military officials, following elections in November 2010. It has an elected parliament and regional assemblies under the new constitution.

The new President Thein Sein, a former general and a former prime minister, launched a bold programme of political and economic reforms, and the movement for change has gathered momentum since April.

Given the above context, on November 18, Suu Kyi announced that she would stand for election as her party has rejoined the political process. The reforms have led Asean countries to accept Myanmar to the Asean in 2014. It is reported that President Obama spoke to Suu Kyi. Thereafter, the president decided to send the US Secretary of State Hilary Clinton to visit Myanmar next month.

Relations between Myanmar and India have been growing in the past few years. Indian President A.P.J. Abdul Kalam visited Myanmar in 2006, and two years later Vice-President M. Hamid Ansari paid an official visit in 2009.

Reciprocally, Myanmar's former leader Senior-General Than Shwe, Chairman of the State Peace and Development Council and Vice Chairman, Vice Senior-General Maung Aye, also visited India in 2010 and 2008 respectively.

During the British period, there was an understanding that China's presence would not go beyond the west of the Irrawaddy River, but that was not to be as China's influence grew increasingly to the coast from the west of the river, opening the Indian Ocean to China from Myanmar.

Myanmar is of extreme strategic and economic importance for India. The two nations share a 1,600 km land border and a long maritime boundary in the strategically important Andaman Sea in the Bay of Bengal. Four of India's politically-sensitive Northeastern states share international borders with Myanmar. India could not be silent about its security and energy concerns.

India changed its earlier policy and began engaging Myanmar's military government in the mid-1990s as a counter to China's growing strategic influence. The shift of Indian policy drew international criticism, with US President Barack Obama chiding India during a visit in November 2010 for not speaking out over human rights abuses in Myanmar.

For energy-hungry India, resource-rich Myanmar with its large oil and natural gas reserves is an inviting prospect. In 2007, India lost Myanmar's gas to China, which was a setback for India.

G. Parthasarathy, a former Indian ambassador to Myanmar, said New Delhi had always argued that Western sanctions against Myanmar were a "low-cost option" that simply drove the junta deeper into the arms of China. "I think we are seeing that our policy of engagement has paid off. We said the move towards democracy would be incremental, and we are seeing that now," Parthasarathy said.

Myanmar-India bilateral trade reached $1.071 billion in 2010-11 and India stood as Myanmar's fourth largest trading partner after Thailand, Singapore and China, according to official statistics. Of the total, Myanmar's export to India amounted to $876.91 million, while its import from India was valued at $194.92 million.

Agricultural produce and forestry products lead in Myanmar's export to India, whereas pharmaceutical products top its imports from India. India is a major buyer of Myanmar's beans, taking up 70% of the latter's exported agricultural produce.

To seek more cooperation in the agricultural sector, Myanmar Agriculture and Irrigation Minister U Myint Hlaing and Indian Ambassador to Myanmar Dr. Villur Sundararajan discussed the proposed cooperation project matters in Nay Pyi Taw last month.

In June this year, a memorandum of understanding on building of an industrial training school in Myanmar's Myingyan was signed between the two governments during a visit to Nay Pyi Taw by Indian Foreign Minister S.M. Krishna.

According to Myanmar official figures, India's contracted investment in Myanmar amounted to $189 million dollars as of March 2011, since the government opened to foreign investment in late 1988, of which $137 million were drawn into the oil and gas sector in 2007. India stands 13th in Myanmar's foreign investors' line-up.

The two countries have placed emphasis on the upgrading of border roads and maritime transport along the Kaladan River to boost trade. Accordingly, India laid the foundation in December 2010 for the construction of a port and waterway terminal of a Myanmar-India Kaladan Multimodal Transit Transport Project in Sittway (Akyab) township of western Myanmar's Rakhine (Arakan) state. The Kaladan River project, involving the Indian Inland Waterways Authority and ESSAR Projects (India) Co Ltd, is expected to be completed by 2013.

India has planned to help Myanmar boost the eco-tourism sector as part of its assistance rendered to countries of the Association of Southeast Asian Nations (Asean) by assisting in maintenance of ancient buildings in archeological and historical sites. Myanmar and India signed a memorandum of understanding on cultural cooperation in Nay Pyi Taw in April this year to speed up all-round renovation of the Arnanda Pagoda in Myanmar's ancient city of Bagan.

"There's a widespread perception that China has taken advantage of Myanmar's situation over these past decades," according to Thant Myint-U, author of Where China Meets India: Myanmar and the New Crossroads of Asia.

Thein Sein's first trip after assuming the presidency on March 30 was to India, not China. Some saw the move as signaling the desire of Thein Sein's new government to re-align and balance its policy towards both China and India. This policy may open doors to Western nations that maintain sanctions imposed on the former military regime.

New Delhi clearly scents new opportunities under Thein Sein's leadership since Myanmar appears to be seeking greater "diplomatic elbow room" that would leave more space for India.

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